(Newswire.net — March 20, 2023) — How much a business outlays on a monthly basis has a direct correlation to its overall success. According to Scott Crockett of Everest Business Funding, keeping your overhead in check is essential, as it can quickly get out of control and drown you, especially during rapid expansion.
High overhead leads to lower profits, which can lead to a failing business if you’re not careful. Going through cost-cutting exercises may be necessary if you’ve already reached that point.
Below are some ways that you can reduce business overhead as you look to build a sustainable business.
Hire an Accountant
It may seem counterintuitive to spend money on a new employee or contractor when you’re looking to save money, but this could lead to significant cost savings in the long run. A professional accountant — whether a full-time staffer or part-time outside consultant — is trained to analyze your business’ back end to identify areas of concern and/or opportunity.
When you hire an accountant for the first time, they can comb through your books to identify potential easy cost-cutting measures to save you a lot of money. They can also help you take advantage of some tax deductions to increase your profits.
Finally, once these exercises are done, the accountant can help you create a well-oiled financial machine in which your operations run efficiently, and you never make a costly financial error.
Look at Your Office Space
The COVID-19 pandemic taught businesses that they might not need the traditional office space they once had. A good exercise is to analyze your current office space and re-assess whether you need as much space as you have.
Even if you can’t — or don’t want to — transition to a fully-remote work environment, you may be able to find a way to reduce the amount of office space you need. This could lead to huge savings, as office space is often one of the largest monthly expenses for businesses.
Analyze Your Team
When businesses look to cut costs, they often turn immediately toward their employee base. This is natural, as salaries and wages are typically the most expensive line item for a business’ overhead.
Don’t start just cutting employees, though, as making the wrong decisions could actually be very detrimental. With the help of your trusted leaders, do a full-scale analysis of your team. Look for where you might have duplicate jobs and eliminate where you can.
Again, though, be careful not to cut too much. Investing in solid employees is one of the best decisions you can make.
Look to Outsource
Outsourcing often gets a bad rap. But Scott Crockett says that it shouldn’t be this way.
There are plenty of ways that outsourcing can be extremely beneficial to your business — both in terms of cost-cutting and also in terms of the services you receive.
Any major department that isn’t within your company’s core competencies should be at least considered for outsourcing. This includes payroll, accounting, IT, and marketing.
All of these vital tasks — and more — could be served better if a third-party partner was handling them. In the long run, you could save money while also receiving better services than if you tried to handle this in-house.
About Scott Crockett
Scott Crockett is the founder and CEO of Everest Business Funding. He is a seasoned professional with 20 years of experience in the finance industry. Mr. Crockett’s track record includes raising more than $250 million in capital and creating thousands of jobs. Scott has founded, built, and managed several finance companies in the consumer and commercial finance sectors.